DBRS Assigns Rating of BB, Stable Trend, to Parkland Fuel Corporation’s New Debt Issuance

DBRS Limited (DBRS) has today assigned a rating of BB with a Stable trend to Parkland Fuel Corporation’s (Parkland; rated BB with a Stable trend by DBRS) issuance of $500 million 5.625% Senior Unsecured Notes (the Notes) due May 9, 2025, which closed on May 9, 2017.

The Notes are direct senior unsecured obligations of Parkland and rank pari passu with all of Parkland’s existing and future senior unsecured indebtedness and senior in right of payment to any future subordinated indebtedness. The Notes are also effectively subordinated to all secured indebtedness, including Parkland’s indebtedness pursuant to its credit agreement. Consistent with Parkland’s existing Senior Unsecured Notes, the Notes are guaranteed by certain of Parkland’s restricted subsidiaries, which, along with Parkland, currently account for more than 99% of Parkland’s consolidated assets and revenues.

Net proceeds from the Notes are expected to be used by Parkland to fund a portion of the costs associated with the acquisition of certain western Canadian retail, commercial, wholesale and fuel supply assets — including a refinery located in Western Canada — owned, directly or indirectly, by Chevron Canada R&M ULC (the Chevron Acquisition). In the event the Chevron Acquisition is not completed, Parkland may use the net proceeds from the Notes to reduce indebtedness, fund future acquisitions and for general corporate purposes.

Notes:
All figures are in Canadian dollars unless otherwise noted.

The principal methodologies are Rating Companies in the Merchandising Industry and DBRS Criteria: Recovery Ratings for Non-Investment Grade Corporate Issuers, which can be found on dbrs.com under Methodologies.

The rated entity or its related entities did participate in the rating process. DBRS had access to the accounts and other relevant internal documents of the rated entity or its related entities.

For more information on this credit or on this industry, visit www.dbrs.com or contact us at info@dbrs.com.